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Explained: Which brands have suspended operations in Russia?

A number of brands have pulled out from Russia in response to its invasion of Ukraine. Which companies have suspended operations in Russia, and why?

By: Explained Desk | New Delhi |
March 11, 2022 2:23:32 pm
People walk past a McDonald's restaurant in the main street in Moscow, Russia, Wednesday, March 9, 2022. (AP Photo)

A number of brands have pulled out from Russia, the world’s largest country geographically, which is currently on a mission to invade Europe’s second-largest — Ukraine. Since the invasion began a fortnight ago, people on social media have been urging brands and companies to suspend their operations in Russia as a way of “standing with Ukraine”.

One of these calls came from Hollywood actor Sean Penn, who recently took to Twitter and said, “Until Coca-Cola, PepsiCo & McDonalds suspend business in Russia, American citizens have a very safe & simple way to stand with Ukraine. Any among us can suspend our purchases of their products & ask our friends to consider doing the same.”

While some brands have already withdrawn, there are others who are still doing business in the country. One of them is the clothing brand Uniqlo, whose owner has decided to keep shops open saying that clothing is a “necessity of life”.

Ukraine war update, March 11 |The view from the South Asian region

In the digital age, it is not unusual for social media users to call on companies and businesses to take political stands. Last July, for instance, the ice cream manufacturer Ben and Jerry’s decided not to sell its products in Israel-occupied Palestine. Following the announcement, Israel’s President Isaac Herzog called it “economic terrorism”. The ice cream company maintains that businesses have a responsibility and an opportunity to bring about change in the world. Ben and Jerry’s has not shied away from expressing this publicly; the brand has been vocal about their support for other causes such as the Black Lives Movement, voting rights, LGBTQ+ rights, climate justice and refugee reform.

Which companies have suspended operations in Russia?

When the Berlin Wall fell three decades ago marking the end of the Soviet Union, a number of companies from the West got the opportunity to set up their operations in Russia. But today, as Russia tries to invade Ukraine, some of these companies are shutting shop.

Most recently, McDonald’s, Starbucks and Coca-Cola have decided to leave Russia. McDonald’s operates about 850 stories in the country and said the temporary closure will cost the fast-food chain about $50 million per month, according to a Reuters report.

Yum Brands has said it is suspending operations of company-owned KFC restaurants, and is finalising an agreement to shut all the Pizza Hut restaurants as well. This will likely affect the operations of 1,000 KFC restaurants and 50 Pizza Huts.

In a statement, the company said, “Like so many across the world, we are shocked and saddened by the tragic events unfolding in Ukraine. Yum! Brands has suspended all investment and restaurant development in Russia while we continue to assess additional options.”

On Wednesday, Coca-Cola announced it was suspending its business in Russia. “Our hearts are with the people who are enduring unconscionable effects from these tragic events in Ukraine. We will continue to monitor and assess the situation as circumstances evolve,” it said in a statement.

Streaming services Netflix and Amazon Prime have also suspended their services in Russia, so has the American coffee chain Starbucks.

Other businesses that have made similar decisions include Levis, Samsung, Tik Tok, Apple Inc, Nike and Microsoft.

The BBC reported that in Russia’s biggest shopping mall located in Moscow, a number of stores including H&M, Sephora, Zara, Tommy Hilfiger, Swatch, Mango, Puma and Ikea among a few others have closed their stores.

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